Last week we listed three essentials for estate planning, emphasizing the need to get the estate in order now -- planning ahead for your family and loved ones, so they will not have to contend with the will or other details in their time of mourning. It can also be a comfort to you, knowing everything is in place.
A quick re-cap:
- Name your Beneficiary
- Name Legal Guardians
- Write Your Will
The final two points on the list are also essential to the execution of the estate.
4. Powers of Attorney
The powers granted in writing powers of attorney are applicable to health care in the case of incapacitation. This person, the "agent" acts on behalf of the grantor. However, if this is not arranged while the grantor has the requisite mental capacity, it may not hold up in court or anywhere else. Decisions about end-of-life care often made by the agent who holds power of attorney, so be sure it is someone who will be able to remain as unemotional as possible and who will have a full understanding of your wishes.
5. Choose an executor
After you've written your will, you will have to decide who will execute the plan. Give this person the power in the will to pay debts and other expenses, in addition to doling out assets. This is a big job, and if there are strained family dynamics, it may be best to choose your current attorney or denote a probate-specialized attorney to make the process as simple as possible
Taking the worry out of end-of-life issues is an important consideration. With those five steps in mind, you will be well on your way to a smooth process for your loved ones, and peace of mind for yourself.
Source: Morningstar, "5 Estate-Planning Tasks That You Shouldn't Put Off," Christine Benz, Aug. 20, 2012